Employers might decide to report income from wage garnishments in box 14 on a W-2 form. The Internal Revenue Service does not legally require you to put the total sum that you have removed from an employee’s paycheck. If you include the figure, make sure to:
- Step 1: Add the money that you garnished from a paycheck for the most recent tax year
- Step 2: Enter the sum total into box 14, labeled “Other”
Employers face actual legally-required steps that they must fulfill when an employee faces wage garnishments. These steps are:
- Step 1: Withhold the court or government agency’s mandated amount from an employee paycheck once you receive a notice.
- Step 2: Confirm that you have received any notice of wage garnishment and state your compliance within one week.
- Step 3: Send the amount that you withheld to a creditor.
In 2025, there were discussions that the U.S. Department of Education might begin taking a portion of paychecks from student loan borrowers who were in default. According to CNBC, experts reported that the Department could garnish as much as 15% of disposable pay.
People Also Ask
- Can payroll software handle garnishments and wage attachments? – Yes, when you get payroll software it should be able to handle both of these elements. Users can generally automate garnishments and wage attachments after properly setting up a system.
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